public law 111–154 111th congress an act · public law 111–154—mar. 31, 2010 124 stat. 1091...

124 STAT. 1087 PUBLIC LAW 111–154—MAR. 31, 2010

Public Law 111–154 111th Congress

An Act To prevent tobacco smuggling, to ensure the collection of all tobacco taxes, and

for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE; FINDINGS; PURPOSES.

(a) SHORT TITLE.—This Act may be cited as the ‘‘Prevent All Cigarette Trafficking Act of 2009’’ or ‘‘PACT Act’’.

(b) FINDINGS.—Congress finds that— (1) the sale of illegal cigarettes and smokeless tobacco

products significantly reduces Federal, State, and local govern-ment revenues, with Internet sales alone accounting for billions of dollars of lost Federal, State, and local tobacco tax revenue each year;

(2) Hezbollah, Hamas, al Qaeda, and other terrorist organizations have profited from trafficking in illegal cigarettes or counterfeit cigarette tax stamps;

(3) terrorist involvement in illicit cigarette trafficking will continue to grow because of the large profits such organizations can earn;

(4) the sale of illegal cigarettes and smokeless tobacco over the Internet, and through mail, fax, or phone orders, makes it cheaper and easier for children to obtain tobacco products;

(5) the majority of Internet and other remote sales of cigarettes and smokeless tobacco are being made without ade-quate precautions to protect against sales to children, without the payment of applicable taxes, and without complying with the nominal registration and reporting requirements in existing Federal law;

(6) unfair competition from illegal sales of cigarettes and smokeless tobacco is taking billions of dollars of sales away from law-abiding retailers throughout the United States;

(7) with rising State and local tobacco tax rates, the incen-tives for the illegal sale of cigarettes and smokeless tobacco have increased;

(8) the number of active tobacco investigations being con-ducted by the Bureau of Alcohol, Tobacco, Firearms, and Explo-sives rose to 452 in 2005;

(9) the number of Internet vendors in the United States and in foreign countries that sell cigarettes and smokeless tobacco to buyers in the United States increased from only about 40 in 2000 to more than 500 in 2005; and

15 USC 375 note.

15 USC 375 note.

Prevent All Cigarette Trafficking Act of 2009.

Mar. 31, 2010 [S. 1147]

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(10) the intrastate sale of illegal cigarettes and smokeless tobacco over the Internet has a substantial effect on interstate commerce. (c) PURPOSES.—It is the purpose of this Act to—

(1) require Internet and other remote sellers of cigarettes and smokeless tobacco to comply with the same laws that apply to law-abiding tobacco retailers;

(2) create strong disincentives to illegal smuggling of tobacco products;

(3) provide government enforcement officials with more effective enforcement tools to combat tobacco smuggling;

(4) make it more difficult for cigarette and smokeless tobacco traffickers to engage in and profit from their illegal activities;

(5) increase collections of Federal, State, and local excise taxes on cigarettes and smokeless tobacco; and

(6) prevent and reduce youth access to inexpensive ciga-rettes and smokeless tobacco through illegal Internet or contra-band sales.

SEC. 2. COLLECTION OF STATE CIGARETTE AND SMOKELESS TOBACCO TAXES.

(a) DEFINITIONS.—The Act of October 19, 1949 (15 U.S.C. 375 et seq.; commonly referred to as the ‘‘Jenkins Act’’) (referred to in this Act as the ‘‘Jenkins Act’’), is amended by striking the first section and inserting the following:

‘‘SECTION 1. DEFINITIONS.

‘‘As used in this Act, the following definitions apply: ‘‘(1) ATTORNEY GENERAL.—The term ‘attorney general’, with

respect to a State, means the attorney general or other chief law enforcement officer of the State.

‘‘(2) CIGARETTE.— ‘‘(A) IN GENERAL.—The term ‘cigarette’—

‘‘(i) has the meaning given that term in section 2341 of title 18, United States Code; and

‘‘(ii) includes roll-your-own tobacco (as defined in section 5702 of the Internal Revenue Code of 1986). ‘‘(B) EXCEPTION.—The term ‘cigarette’ does not include

a cigar (as defined in section 5702 of the Internal Revenue Code of 1986). ‘‘(3) COMMON CARRIER.—The term ‘common carrier’ means

any person (other than a local messenger service or the United States Postal Service) that holds itself out to the general public as a provider for hire of the transportation by water, land, or air of merchandise (regardless of whether the person actually operates the vessel, vehicle, or aircraft by which the transpor-tation is provided) between a port or place and a port or place in the United States.

‘‘(4) CONSUMER.—The term ‘consumer’— ‘‘(A) means any person that purchases cigarettes or

smokeless tobacco; and ‘‘(B) does not include any person lawfully operating

as a manufacturer, distributor, wholesaler, or retailer of cigarettes or smokeless tobacco. ‘‘(5) DELIVERY SALE.—The term ‘delivery sale’ means any

sale of cigarettes or smokeless tobacco to a consumer if—

15 USC 375.


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‘‘(A) the consumer submits the order for the sale by means of a telephone or other method of voice transmission, the mails, or the Internet or other online service, or the seller is otherwise not in the physical presence of the buyer when the request for purchase or order is made; or

‘‘(B) the cigarettes or smokeless tobacco are delivered to the buyer by common carrier, private delivery service, or other method of remote delivery, or the seller is not in the physical presence of the buyer when the buyer obtains possession of the cigarettes or smokeless tobacco. ‘‘(6) DELIVERY SELLER.—The term ‘delivery seller’ means

a person who makes a delivery sale. ‘‘(7) INDIAN COUNTRY.—The term ‘Indian country’—

‘‘(A) has the meaning given that term in section 1151 of title 18, United States Code, except that within the State of Alaska that term applies only to the Metlakatla Indian Community, Annette Island Reserve; and

‘‘(B) includes any other land held by the United States in trust or restricted status for one or more Indian tribes. ‘‘(8) INDIAN TRIBE.—The term ‘Indian tribe’, ‘tribe’, or ‘tribal’

refers to an Indian tribe as defined in section 4(e) of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 450b(e)) or as listed pursuant to section 104 of the Federally Recognized Indian Tribe List Act of 1994 (25 U.S.C. 479a–1).

‘‘(9) INTERSTATE COMMERCE.— ‘‘(A) IN GENERAL.—The term ‘interstate commerce’

means commerce between a State and any place outside the State, commerce between a State and any Indian country in the State, or commerce between points in the same State but through any place outside the State or through any Indian country.

‘‘(B) INTO A STATE, PLACE, OR LOCALITY.—A sale, ship-ment, or transfer of cigarettes or smokeless tobacco that is made in interstate commerce, as defined in this para-graph, shall be deemed to have been made into the State, place, or locality in which such cigarettes or smokeless tobacco are delivered. ‘‘(10) PERSON.—The term ‘person’ means an individual, cor-

poration, company, association, firm, partnership, society, State government, local government, Indian tribal government, governmental organization of such a government, or joint stock company.

‘‘(11) STATE.—The term ‘State’ means each of the several States of the United States, the District of Columbia, the Commonwealth of Puerto Rico, or any territory or possession of the United States.

‘‘(12) SMOKELESS TOBACCO.—The term ‘smokeless tobacco’ means any finely cut, ground, powdered, or leaf tobacco, or other product containing tobacco, that is intended to be placed in the oral or nasal cavity or otherwise consumed without being combusted.

‘‘(13) TOBACCO TAX ADMINISTRATOR.—The term ‘tobacco tax administrator’ means the State, local, or tribal official duly authorized to collect the tobacco tax or administer the tax law of a State, locality, or tribe, respectively.


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‘‘(14) USE.—The term ‘use’ includes the consumption, stor-age, handling, or disposal of cigarettes or smokeless tobacco.’’. (b) REPORTS TO STATE TOBACCO TAX ADMINISTRATORS.—Section

2 of the Jenkins Act (15 U.S.C. 376) is amended— (1) by striking ‘‘cigarettes’’ each place it appears and

inserting ‘‘cigarettes or smokeless tobacco’’; (2) in subsection (a)—

(A) in the matter preceding paragraph (1)— (i) by inserting ‘‘CONTENTS.—’’ after ‘‘(a)’’; (ii) by striking ‘‘or transfers’’ and inserting ‘‘, trans-

fers, or ships’’; (iii) by inserting ‘‘, locality, or Indian country of

an Indian tribe’’ after ‘‘a State’’; (iv) by striking ‘‘to other than a distributor licensed

by or located in such State,’’; and (v) by striking ‘‘or transfer and shipment’’ and

inserting ‘‘, transfer, or shipment’’; (B) in paragraph (1)—

(i) by striking ‘‘with the tobacco tax administrator of the State’’ and inserting ‘‘with the Attorney General of the United States and with the tobacco tax adminis-trators of the State and place’’; and

(ii) by striking ‘‘; and’’ and inserting the following: ‘‘, as well as telephone numbers for each place of busi-ness, a principal electronic mail address, any website addresses, and the name, address, and telephone number of an agent in the State authorized to accept service on behalf of the person;’’; (C) in paragraph (2), by striking ‘‘and the quantity

thereof.’’ and inserting ‘‘the quantity thereof, and the name, address, and phone number of the person delivering the shipment to the recipient on behalf of the delivery seller, with all invoice or memoranda information relating to spe-cific customers to be organized by city or town and by zip code; and’’; and

(D) by adding at the end the following: ‘‘(3) with respect to each memorandum or invoice filed

with a State under paragraph (2), also file copies of the memo-randum or invoice with the tobacco tax administrators and chief law enforcement officers of the local governments and Indian tribes operating within the borders of the State that apply their own local or tribal taxes on cigarettes or smokeless tobacco.’’;

(3) in subsection (b)— (A) by inserting ‘‘PRESUMPTIVE EVIDENCE.—’’ after

‘‘(b)’’; (B) by striking ‘‘(1) that’’ and inserting ‘‘that’’; and (C) by striking ‘‘, and (2)’’ and all that follows and

inserting a period; and (4) by adding at the end the following:

‘‘(c) USE OF INFORMATION.—A tobacco tax administrator or chief law enforcement officer who receives a memorandum or invoice under paragraph (2) or (3) of subsection (a) shall use the memo-randum or invoice solely for the purposes of the enforcement of this Act and the collection of any taxes owed on related sales of cigarettes and smokeless tobacco, and shall keep confidential


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any personal information in the memorandum or invoice except as required for such purposes.’’.

(c) REQUIREMENTS FOR DELIVERY SALES.—The Jenkins Act is amended by inserting after section 2 the following:

‘‘SEC. 2A. DELIVERY SALES.

‘‘(a) IN GENERAL.—With respect to delivery sales into a specific State and place, each delivery seller shall comply with—

‘‘(1) the shipping requirements set forth in subsection (b); ‘‘(2) the recordkeeping requirements set forth in subsection

(c); ‘‘(3) all State, local, tribal, and other laws generally

applicable to sales of cigarettes or smokeless tobacco as if the delivery sales occurred entirely within the specific State and place, including laws imposing—

‘‘(A) excise taxes; ‘‘(B) licensing and tax-stamping requirements; ‘‘(C) restrictions on sales to minors; and ‘‘(D) other payment obligations or legal requirements

relating to the sale, distribution, or delivery of cigarettes or smokeless tobacco; and ‘‘(4) the tax collection requirements set forth in subsection

(d). ‘‘(b) SHIPPING AND PACKAGING.—

‘‘(1) REQUIRED STATEMENT.—For any shipping package con-taining cigarettes or smokeless tobacco, the delivery seller shall include on the bill of lading, if any, and on the outside of the shipping package, on the same surface as the delivery address, a clear and conspicuous statement providing as follows: ‘CIGARETTES/SMOKELESS TOBACCO: FEDERAL LAW REQUIRES THE PAYMENT OF ALL APPLICABLE EXCISE TAXES, AND COMPLIANCE WITH APPLICABLE LICENSING AND TAX-STAMPING OBLIGATIONS’.

‘‘(2) FAILURE TO LABEL.—Any shipping package described in paragraph (1) that is not labeled in accordance with that paragraph shall be treated as nondeliverable matter by a common carrier or other delivery service, if the common carrier or other delivery service knows or should know the package contains cigarettes or smokeless tobacco. If a common carrier or other delivery service believes a package is being submitted for delivery in violation of paragraph (1), it may require the person submitting the package for delivery to establish that it is not being sent in violation of paragraph (1) before accepting the package for delivery. Nothing in this paragraph shall require the common carrier or other delivery service to open any package to determine its contents.

‘‘(3) WEIGHT RESTRICTION.—A delivery seller shall not sell, offer for sale, deliver, or cause to be delivered in any single sale or single delivery any cigarettes or smokeless tobacco weighing more than 10 pounds.

‘‘(4) AGE VERIFICATION.— ‘‘(A) IN GENERAL.—A delivery seller who mails or ships

tobacco products— ‘‘(i) shall not sell, deliver, or cause to be delivered

any tobacco products to a person under the minimum age required for the legal sale or purchase of tobacco

15 USC 376a.


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products, as determined by the applicable law at the place of delivery;

‘‘(ii) shall use a method of mailing or shipping that requires—

‘‘(I) the purchaser placing the delivery sale order, or an adult who is at least the minimum age required for the legal sale or purchase of tobacco products, as determined by the applicable law at the place of delivery, to sign to accept delivery of the shipping container at the delivery address; and

‘‘(II) the person who signs to accept delivery of the shipping container to provide proof, in the form of a valid, government-issued identification bearing a photograph of the individual, that the person is at least the minimum age required for the legal sale or purchase of tobacco products, as determined by the applicable law at the place of delivery; and ‘‘(iii) shall not accept a delivery sale order from

a person without— ‘‘(I) obtaining the full name, birth date, and

residential address of that person; and ‘‘(II) verifying the information provided in sub-

clause (I), through the use of a commercially avail-able database or aggregate of databases, consisting primarily of data from government sources, that are regularly used by government and businesses for the purpose of age and identity verification and authentication, to ensure that the purchaser is at least the minimum age required for the legal sale or purchase of tobacco products, as determined by the applicable law at the place of delivery.

‘‘(B) LIMITATION.—No database being used for age and identity verification under subparagraph (A)(iii) shall be in the possession or under the control of the delivery seller, or be subject to any changes or supplementation by the delivery seller.

‘‘(c) RECORDS.— ‘‘(1) IN GENERAL.—Each delivery seller shall keep a record

of any delivery sale, including all of the information described in section 2(a)(2), organized by the State, and within the State, by the city or town and by zip code, into which the delivery sale is so made.

‘‘(2) RECORD RETENTION.—Records of a delivery sale shall be kept as described in paragraph (1) until the end of the 4th full calendar year that begins after the date of the delivery sale.

‘‘(3) ACCESS FOR OFFICIALS.—Records kept under paragraph (1) shall be made available to tobacco tax administrators of the States, to local governments and Indian tribes that apply local or tribal taxes on cigarettes or smokeless tobacco, to the attorneys general of the States, to the chief law enforcement officers of the local governments and Indian tribes, and to the Attorney General of the United States in order to ensure the compliance of persons making delivery sales with the requirements of this Act.


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‘‘(d) DELIVERY.— ‘‘(1) IN GENERAL.—Except as provided in paragraph (2),

no delivery seller may sell or deliver to any consumer, or tender to any common carrier or other delivery service, any cigarettes or smokeless tobacco pursuant to a delivery sale unless, in advance of the sale, delivery, or tender—

‘‘(A) any cigarette or smokeless tobacco excise tax that is imposed by the State in which the cigarettes or smokeless tobacco are to be delivered has been paid to the State;

‘‘(B) any cigarette or smokeless tobacco excise tax that is imposed by the local government of the place in which the cigarettes or smokeless tobacco are to be delivered has been paid to the local government; and

‘‘(C) any required stamps or other indicia that the excise tax has been paid are properly affixed or applied to the cigarettes or smokeless tobacco. ‘‘(2) EXCEPTION.—Paragraph (1) does not apply to a delivery

sale of smokeless tobacco if the law of the State or local govern-ment of the place where the smokeless tobacco is to be delivered requires or otherwise provides that delivery sellers collect the excise tax from the consumer and remit the excise tax to the State or local government, and the delivery seller complies with the requirement. ‘‘(e) LIST OF UNREGISTERED OR NONCOMPLIANT DELIVERY

SELLERS.— ‘‘(1) IN GENERAL.—

‘‘(A) INITIAL LIST.—Not later than 90 days after this subsection goes into effect under the Prevent All Cigarette Trafficking Act of 2009, the Attorney General of the United States shall compile a list of delivery sellers of cigarettes or smokeless tobacco that have not registered with the Attorney General of the United States pursuant to section 2(a), or that are otherwise not in compliance with this Act, and—

‘‘(i) distribute the list to— ‘‘(I) the attorney general and tax administrator

of every State; ‘‘(II) common carriers and other persons that

deliver small packages to consumers in interstate commerce, including the United States Postal Service; and

‘‘(III) any other person that the Attorney Gen-eral of the United States determines can promote the effective enforcement of this Act; and ‘‘(ii) publicize and make the list available to any

other person engaged in the business of interstate deliveries or who delivers cigarettes or smokeless tobacco in or into any State. ‘‘(B) LIST CONTENTS.—To the extent known, the

Attorney General of the United States shall include, for each delivery seller on the list described in subparagraph (A)—

‘‘(i) all names the delivery seller uses or has used in the transaction of its business or on packages deliv-ered to customers;

Deadline.


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‘‘(ii) all addresses from which the delivery seller does or has done business, or ships or has shipped cigarettes or smokeless tobacco;

‘‘(iii) the website addresses, primary e-mail address, and phone number of the delivery seller; and

‘‘(iv) any other information that the Attorney Gen-eral of the United States determines would facilitate compliance with this subsection by recipients of the list. ‘‘(C) UPDATING.—The Attorney General of the United

States shall update and distribute the list described in subparagraph (A) at least once every 4 months, and may distribute the list and any updates by regular mail, elec-tronic mail, or any other reasonable means, or by providing recipients with access to the list through a nonpublic website that the Attorney General of the United States regularly updates.

‘‘(D) STATE, LOCAL, OR TRIBAL ADDITIONS.—The Attorney General of the United States shall include in the list described in subparagraph (A) any noncomplying delivery sellers identified by any State, local, or tribal government under paragraph (6), and shall distribute the list to the attorney general or chief law enforcement official and the tax administrator of any government submitting any such information, and to any common carriers or other persons who deliver small packages to consumers identified by any government pursuant to paragraph (6).

‘‘(E) ACCURACY AND COMPLETENESS OF LIST OF NONCOM-PLYING DELIVERY SELLERS.—In preparing and revising the list described in subparagraph (A), the Attorney General of the United States shall—

‘‘(i) use reasonable procedures to ensure maximum possible accuracy and completeness of the records and information relied on for the purpose of determining that a delivery seller is not in compliance with this Act;

‘‘(ii) not later than 14 days before including a delivery seller on the list, make a reasonable attempt to send notice to the delivery seller by letter, electronic mail, or other means that the delivery seller is being placed on the list, which shall cite the relevant provi-sions of this Act and the specific reasons for which the delivery seller is being placed on the list;

‘‘(iii) provide an opportunity to the delivery seller to challenge placement on the list;

‘‘(iv) investigate each challenge described in clause (iii) by contacting the relevant Federal, State, tribal, and local law enforcement officials, and provide the specific findings and results of the investigation to the delivery seller not later than 30 days after the date on which the challenge is made; and

‘‘(v) if the Attorney General of the United States determines that the basis for including a delivery seller on the list is inaccurate, based on incomplete informa-tion, or cannot be verified, promptly remove the delivery seller from the list as appropriate and notify

Determination. Notification.

Deadline.

Deadline. Notice.

Distribution.

Deadlines.

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each appropriate Federal, State, tribal, and local authority of the determination. ‘‘(F) CONFIDENTIALITY.—The list described in subpara-

graph (A) shall be confidential, and any person receiving the list shall maintain the confidentiality of the list and may deliver the list, for enforcement purposes, to any government official or to any common carrier or other person that delivers tobacco products or small packages to consumers. Nothing in this section shall prohibit a common carrier, the United States Postal Service, or any other person receiving the list from discussing with a listed delivery seller the inclusion of the delivery seller on the list and the resulting effects on any services requested by the listed delivery seller. ‘‘(2) PROHIBITION ON DELIVERY.—

‘‘(A) IN GENERAL.—Commencing on the date that is 60 days after the date of the initial distribution or avail-ability of the list described in paragraph (1)(A), no person who receives the list under paragraph (1), and no person who delivers cigarettes or smokeless tobacco to consumers, shall knowingly complete, cause to be completed, or com-plete its portion of a delivery of any package for any person whose name and address are on the list, unless—

‘‘(i) the person making the delivery knows or believes in good faith that the item does not include cigarettes or smokeless tobacco;

‘‘(ii) the delivery is made to a person lawfully engaged in the business of manufacturing, distributing, or selling cigarettes or smokeless tobacco; or

‘‘(iii) the package being delivered weighs more than 100 pounds and the person making the delivery does not know or have reasonable cause to believe that the package contains cigarettes or smokeless tobacco. ‘‘(B) IMPLEMENTATION OF UPDATES.—Commencing on

the date that is 30 days after the date of the distribution or availability of any updates or corrections to the list described in paragraph (1)(A), all recipients and all common carriers or other persons that deliver cigarettes or smoke-less tobacco to consumers shall be subject to subparagraph (A) in regard to the corrections or updates. ‘‘(3) EXEMPTIONS.—

‘‘(A) IN GENERAL.—Subsection (b)(2) and any require-ments or restrictions placed directly on common carriers under this subsection, including subparagraphs (A) and (B) of paragraph (2), shall not apply to a common carrier that—

‘‘(i) is subject to a settlement agreement described in subparagraph (B); or

‘‘(ii) if a settlement agreement described in subparagraph (B) to which the common carrier is a party is terminated or otherwise becomes inactive, is administering and enforcing policies and practices throughout the United States that are at least as strin-gent as the agreement. ‘‘(B) SETTLEMENT AGREEMENT.—A settlement agree-

ment described in this subparagraph—

Effective dates.


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‘‘(i) is a settlement agreement relating to tobacco product deliveries to consumers; and

‘‘(ii) includes— ‘‘(I) the Assurance of Discontinuance entered

into by the Attorney General of New York and DHL Holdings USA, Inc. and DHL Express (USA), Inc. on or about July 1, 2005, the Assurance of Discontinuance entered into by the Attorney Gen-eral of New York and United Parcel Service, Inc. on or about October 21, 2005, and the Assurance of Compliance entered into by the Attorney Gen-eral of New York and Federal Express Corporation and FedEx Ground Package Systems, Inc. on or about February 3, 2006, if each of those agree-ments is honored throughout the United States to block illegal deliveries of cigarettes or smokeless tobacco to consumers; and

‘‘(II) any other active agreement between a common carrier and a State that operates through-out the United States to ensure that no deliveries of cigarettes or smokeless tobacco shall be made to consumers or illegally operating Internet or mail-order sellers and that any such deliveries to consumers shall not be made to minors or with-out payment to the States and localities where the consumers are located of all taxes on the tobacco products.

‘‘(4) SHIPMENTS FROM PERSONS ON LIST.— ‘‘(A) IN GENERAL.—If a common carrier or other

delivery service delays or interrupts the delivery of a pack-age in the possession of the common carrier or delivery service because the common carrier or delivery service determines or has reason to believe that the person ordering the delivery is on a list described in paragraph (1)(A) and that clauses (i), (ii), and (iii) of paragraph (2)(A) do not apply—

‘‘(i) the person ordering the delivery shall be obli-gated to pay—

‘‘(I) the common carrier or other delivery service as if the delivery of the package had been timely completed; and

‘‘(II) if the package is not deliverable, any reasonable additional fee or charge levied by the common carrier or other delivery service to cover any extra costs and inconvenience and to serve as a disincentive against such noncomplying delivery orders; and ‘‘(ii) if the package is determined not to be deliver-

able, the common carrier or other delivery service shall offer to provide the package and its contents to a Federal, State, or local law enforcement agency. ‘‘(B) RECORDS.—A common carrier or other delivery

service shall maintain, for a period of 5 years, any records kept in the ordinary course of business relating to any delivery interrupted under this paragraph and provide that information, upon request, to the Attorney General of the United States or to the attorney general or chief law

Time period.


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enforcement official or tax administrator of any State, local, or tribal government.

‘‘(C) CONFIDENTIALITY.—Any person receiving records under subparagraph (B) shall—

‘‘(i) use the records solely for the purposes of the enforcement of this Act and the collection of any taxes owed on related sales of cigarettes and smokeless tobacco; and

‘‘(ii) keep confidential any personal information in the records not otherwise required for such purposes.

‘‘(5) PREEMPTION.— ‘‘(A) IN GENERAL.—No State, local, or tribal govern-

ment, nor any political authority of 2 or more State, local, or tribal governments, may enact or enforce any law or regulation relating to delivery sales that restricts deliveries of cigarettes or smokeless tobacco to consumers by common carriers or other delivery services on behalf of delivery sellers by—

‘‘(i) requiring that the common carrier or other delivery service verify the age or identity of the con-sumer accepting the delivery by requiring the person who signs to accept delivery of the shipping container to provide proof, in the form of a valid, government- issued identification bearing a photograph of the indi-vidual, that the person is at least the minimum age required for the legal sale or purchase of tobacco prod-ucts, as determined by either State or local law at the place of delivery;

‘‘(ii) requiring that the common carrier or other delivery service obtain a signature from the consumer accepting the delivery;

‘‘(iii) requiring that the common carrier or other delivery service verify that all applicable taxes have been paid;

‘‘(iv) requiring that packages delivered by the common carrier or other delivery service contain any particular labels, notice, or markings; or

‘‘(v) prohibiting common carriers or other delivery services from making deliveries on the basis of whether the delivery seller is or is not identified on any list of delivery sellers maintained and distributed by any entity other than the Federal Government. ‘‘(B) RELATIONSHIP TO OTHER LAWS.—Except as pro-

vided in subparagraph (C), nothing in this paragraph shall be construed to nullify, expand, restrict, or otherwise amend or modify—

‘‘(i) section 14501(c)(1) or 41713(b)(4) of title 49, United States Code;

‘‘(ii) any other restrictions in Federal law on the ability of State, local, or tribal governments to regulate common carriers; or

‘‘(iii) any provision of State, local, or tribal law regulating common carriers that is described in section 14501(c)(2) or 41713(b)(4)(B) of title 49 of the United States Code. ‘‘(C) STATE LAWS PROHIBITING DELIVERY SALES.—


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‘‘(i) IN GENERAL.—Except as provided in clause (ii), nothing in the Prevent All Cigarette Trafficking Act of 2009, the amendments made by that Act, or in any other Federal statute shall be construed to preempt, supersede, or otherwise limit or restrict State laws prohibiting the delivery sale, or the shipment or delivery pursuant to a delivery sale, of cigarettes or other tobacco products to individual consumers or personal residences.

‘‘(ii) EXEMPTIONS.—No State may enforce against a common carrier a law prohibiting the delivery of cigarettes or other tobacco products to individual con-sumers or personal residences without proof that the common carrier is not exempt under paragraph (3) of this subsection.

‘‘(6) STATE, LOCAL, AND TRIBAL ADDITIONS.— ‘‘(A) IN GENERAL.—Any State, local, or tribal govern-

ment shall provide the Attorney General of the United States with—

‘‘(i) all known names, addresses, website addresses, and other primary contact information of any delivery seller that—

‘‘(I) offers for sale or makes sales of cigarettes or smokeless tobacco in or into the State, locality, or tribal land; and

‘‘(II) has failed to register with or make reports to the respective tax administrator as required by this Act, or that has been found in a legal proceeding to have otherwise failed to comply with this Act; and ‘‘(ii) a list of common carriers and other persons

who make deliveries of cigarettes or smokeless tobacco in or into the State, locality, or tribal land. ‘‘(B) UPDATES.—Any government providing a list to

the Attorney General of the United States under subpara-graph (A) shall also provide updates and corrections every 4 months until such time as the government notifies the Attorney General of the United States in writing that the government no longer desires to submit information to supplement the list described in paragraph (1)(A).

‘‘(C) REMOVAL AFTER WITHDRAWAL.—Upon receiving written notice that a government no longer desires to submit information under subparagraph (A), the Attorney General of the United States shall remove from the list described in paragraph (1)(A) any persons that are on the list solely because of the prior submissions of the government of the list of the government of noncomplying delivery sellers of cigarettes or smokeless tobacco or a subsequent update or correction by the government. ‘‘(7) DEADLINE TO INCORPORATE ADDITIONS.—The Attorney

General of the United States shall— ‘‘(A) include any delivery seller identified and sub-

mitted by a State, local, or tribal government under para-graph (6) in any list or update that is distributed or made available under paragraph (1) on or after the date that is 30 days after the date on which the information is

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received by the Attorney General of the United States; and

‘‘(B) distribute any list or update described in subpara-graph (A) to any common carrier or other person who makes deliveries of cigarettes or smokeless tobacco that has been identified and submitted by a government pursu-ant to paragraph (6). ‘‘(8) NOTICE TO DELIVERY SELLERS.—Not later than 14 days

before including any delivery seller on the initial list described in paragraph (1)(A), or on an update to the list for the first time, the Attorney General of the United States shall make a reasonable attempt to send notice to the delivery seller by letter, electronic mail, or other means that the delivery seller is being placed on the list or update, with that notice citing the relevant provisions of this Act.

‘‘(9) LIMITATIONS.— ‘‘(A) IN GENERAL.—Any common carrier or other person

making a delivery subject to this subsection shall not be required or otherwise obligated to—

‘‘(i) determine whether any list distributed or made available under paragraph (1) is complete, accurate, or up-to-date;

‘‘(ii) determine whether a person ordering a delivery is in compliance with this Act; or

‘‘(iii) open or inspect, pursuant to this Act, any package being delivered to determine its contents. ‘‘(B) ALTERNATE NAMES.—Any common carrier or other

person making a delivery subject to this subsection— ‘‘(i) shall not be required to make any inquiries

or otherwise determine whether a person ordering a delivery is a delivery seller on the list described in paragraph (1)(A) who is using a different name or address in order to evade the related delivery restric-tions; and

‘‘(ii) shall not knowingly deliver any packages to consumers for any delivery seller on the list described in paragraph (1)(A) who the common carrier or other delivery service knows is a delivery seller who is on the list and is using a different name or address to evade the delivery restrictions of paragraph (2). ‘‘(C) PENALTIES.—Any common carrier or person in the

business of delivering packages on behalf of other persons shall not be subject to any penalty under section 14101(a) of title 49, United States Code, or any other provision of law for—

‘‘(i) not making any specific delivery, or any deliv-eries at all, on behalf of any person on the list described in paragraph (1)(A);

‘‘(ii) refusing, as a matter of regular practice and procedure, to make any deliveries, or any deliveries in certain States, of any cigarettes or smokeless tobacco for any person or for any person not in the business of manufacturing, distributing, or selling cigarettes or smokeless tobacco; or

‘‘(iii) delaying or not making a delivery for any person because of reasonable efforts to comply with this Act.

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‘‘(D) OTHER LIMITS.—Section 2 and subsections (a), (b), (c), and (d) of this section shall not be interpreted to impose any responsibilities, requirements, or liability on common carriers.

‘‘(f) PRESUMPTION.—For purposes of this Act, a delivery sale shall be deemed to have occurred in the State and place where the buyer obtains personal possession of the cigarettes or smokeless tobacco, and a delivery pursuant to a delivery sale is deemed to have been initiated or ordered by the delivery seller.’’.

(d) PENALTIES.—The Jenkins Act is amended by striking section 3 and inserting the following:

‘‘SEC. 3. PENALTIES.

‘‘(a) CRIMINAL PENALTIES.— ‘‘(1) IN GENERAL.—Except as provided in paragraph (2),

whoever knowingly violates this Act shall be imprisoned for not more than 3 years, fined under title 18, United States Code, or both.

‘‘(2) EXCEPTIONS.— ‘‘(A) GOVERNMENTS.—Paragraph (1) shall not apply to

a State, local, or tribal government. ‘‘(B) DELIVERY VIOLATIONS.—A common carrier or inde-

pendent delivery service, or employee of a common carrier or independent delivery service, shall be subject to criminal penalties under paragraph (1) for a violation of section 2A(e) only if the violation is committed knowingly—

‘‘(i) as consideration for the receipt of, or as consid-eration for a promise or agreement to pay, anything of pecuniary value; or

‘‘(ii) for the purpose of assisting a delivery seller to violate, or otherwise evading compliance with, sec-tion 2A.

‘‘(b) CIVIL PENALTIES.— ‘‘(1) IN GENERAL.—Except as provided in paragraph (3),

whoever violates this Act shall be subject to a civil penalty in an amount not to exceed—

‘‘(A) in the case of a delivery seller, the greater of— ‘‘(i) $5,000 in the case of the first violation, or

$10,000 for any other violation; or ‘‘(ii) for any violation, 2 percent of the gross sales

of cigarettes or smokeless tobacco of the delivery seller during the 1-year period ending on the date of the violation. ‘‘(B) in the case of a common carrier or other delivery

service, $2,500 in the case of a first violation, or $5,000 for any violation within 1 year of a prior violation. ‘‘(2) RELATION TO OTHER PENALTIES.—A civil penalty

imposed under paragraph (1) for a violation of this Act shall be imposed in addition to any criminal penalty under subsection (a) and any other damages, equitable relief, or injunctive relief awarded by the court, including the payment of any unpaid taxes to the appropriate Federal, State, local, or tribal govern-ments.

‘‘(3) EXCEPTIONS.— ‘‘(A) DELIVERY VIOLATIONS.—An employee of a common

carrier or independent delivery service shall be subject to civil penalties under paragraph (1) for a violation of

15 USC 377.

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section 2A(e) only if the violation is committed inten-tionally—

‘‘(i) as consideration for the receipt of, or as consid-eration for a promise or agreement to pay, anything of pecuniary value; or

‘‘(ii) for the purpose of assisting a delivery seller to violate, or otherwise evading compliance with, sec-tion 2A. ‘‘(B) OTHER LIMITATIONS.—No common carrier or inde-

pendent delivery service shall be subject to civil penalties under paragraph (1) for a violation of section 2A(e) if—

‘‘(i) the common carrier or independent delivery service has implemented and enforces effective policies and practices for complying with that section; or

‘‘(ii) the violation consists of an employee of the common carrier or independent delivery service who physically receives and processes orders, picks up pack-ages, processes packages, or makes deliveries, taking actions that are outside the scope of employment of the employee, or that violate the implemented and enforced policies of the common carrier or independent delivery service described in clause (i).’’.

(e) ENFORCEMENT.—The Jenkins Act is amended by striking section 4 and inserting the following:

‘‘SEC. 4. ENFORCEMENT.

‘‘(a) IN GENERAL.—The United States district courts shall have jurisdiction to prevent and restrain violations of this Act and to provide other appropriate injunctive or equitable relief, including money damages, for the violations.

‘‘(b) AUTHORITY OF THE ATTORNEY GENERAL.—The Attorney General of the United States shall administer and enforce this Act.

‘‘(c) STATE, LOCAL, AND TRIBAL ENFORCEMENT.— ‘‘(1) IN GENERAL.—

‘‘(A) STANDING.—A State, through its attorney general, or a local government or Indian tribe that levies a tax subject to section 2A(a)(3), through its chief law enforce-ment officer, may bring an action in a United States district court to prevent and restrain violations of this Act by any person or to obtain any other appropriate relief from any person for violations of this Act, including civil pen-alties, money damages, and injunctive or other equitable relief.

‘‘(B) SOVEREIGN IMMUNITY.—Nothing in this Act shall be deemed to abrogate or constitute a waiver of any sov-ereign immunity of a State or local government or Indian tribe against any unconsented lawsuit under this Act, or otherwise to restrict, expand, or modify any sovereign immunity of a State or local government or Indian tribe. ‘‘(2) PROVISION OF INFORMATION.—A State, through its

attorney general, or a local government or Indian tribe that levies a tax subject to section 2A(a)(3), through its chief law enforcement officer, may provide evidence of a violation of this Act by any person not subject to State, local, or tribal government enforcement actions for violations of this Act to the Attorney General of the United States or a United States

Courts.

15 USC 378.


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attorney, who shall take appropriate actions to enforce this Act.

‘‘(3) USE OF PENALTIES COLLECTED.— ‘‘(A) IN GENERAL.—There is established a separate

account in the Treasury known as the ‘PACT Anti-Traf-ficking Fund’. Notwithstanding any other provision of law and subject to subparagraph (B), an amount equal to 50 percent of any criminal and civil penalties collected by the Federal Government in enforcing this Act shall be transferred into the PACT Anti-Trafficking Fund and shall be available to the Attorney General of the United States for purposes of enforcing this Act and other laws relating to contraband tobacco products.

‘‘(B) ALLOCATION OF FUNDS.—Of the amount available to the Attorney General of the United States under subparagraph (A), not less than 50 percent shall be made available only to the agencies and offices within the Depart-ment of Justice that were responsible for the enforcement actions in which the penalties concerned were imposed or for any underlying investigations. ‘‘(4) NONEXCLUSIVITY OF REMEDY.—

‘‘(A) IN GENERAL.—The remedies available under this section and section 3 are in addition to any other remedies available under Federal, State, local, tribal, or other law.

‘‘(B) STATE COURT PROCEEDINGS.—Nothing in this Act shall be construed to expand, restrict, or otherwise modify any right of an authorized State official to proceed in State court, or take other enforcement actions, on the basis of an alleged violation of State or other law.

‘‘(C) TRIBAL COURT PROCEEDINGS.—Nothing in this Act shall be construed to expand, restrict, or otherwise modify any right of an authorized Indian tribal government official to proceed in tribal court, or take other enforcement actions, on the basis of an alleged violation of tribal law.

‘‘(D) LOCAL GOVERNMENT ENFORCEMENT.—Nothing in this Act shall be construed to expand, restrict, or otherwise modify any right of an authorized local government official to proceed in State court, or take other enforcement actions, on the basis of an alleged violation of local or other law.

‘‘(d) PERSONS DEALING IN TOBACCO PRODUCTS.—Any person who holds a permit under section 5712 of the Internal Revenue Code of 1986 (regarding permitting of manufacturers and importers of tobacco products and export warehouse proprietors) may bring an action in an appropriate United States district court to prevent and restrain violations of this Act by any person other than a State, local, or tribal government.

‘‘(e) NOTICE.— ‘‘(1) PERSONS DEALING IN TOBACCO PRODUCTS.—Any person

who commences a civil action under subsection (d) shall inform the Attorney General of the United States of the action.

‘‘(2) STATE, LOCAL, AND TRIBAL ACTIONS.—It is the sense of Congress that the attorney general of any State, or chief law enforcement officer of any locality or tribe, that commences a civil action under this section should inform the Attorney General of the United States of the action. ‘‘(f) PUBLIC NOTICE.—


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‘‘(1) IN GENERAL.—The Attorney General of the United States shall make available to the public, by posting informa-tion on the Internet and by other appropriate means, informa-tion regarding all enforcement actions brought by the United States, or reported to the Attorney General of the United States, under this section, including information regarding the resolu-tion of the enforcement actions and how the Attorney General of the United States has responded to referrals of evidence of violations pursuant to subsection (c)(2).

‘‘(2) REPORTS TO CONGRESS.—Not later than 1 year after the date of enactment of the Prevent All Cigarette Trafficking Act of 2009, and every year thereafter until the date that is 5 years after such date of enactment, the Attorney General of the United States shall submit to Congress a report con-taining the information described in paragraph (1).’’.

SEC. 3. TREATMENT OF CIGARETTES AND SMOKELESS TOBACCO AS NONMAILABLE MATTER.

(a) IN GENERAL.—Chapter 83 of title 18, United States Code, is amended by inserting after section 1716D the following:

‘‘§ 1716E. Tobacco products as nonmailable ‘‘(a) PROHIBITION.—

‘‘(1) IN GENERAL.—All cigarettes and smokeless tobacco (as those terms are defined in section 1 of the Act of October 19, 1949, commonly referred to as the Jenkins Act) are non-mailable and shall not be deposited in or carried through the mails. The United States Postal Service shall not accept for delivery or transmit through the mails any package that it knows or has reasonable cause to believe contains any cigarettes or smokeless tobacco made nonmailable by this paragraph.

‘‘(2) REASONABLE CAUSE.—For the purposes of this sub-section reasonable cause includes—

‘‘(A) a statement on a publicly available website, or an advertisement, by any person that the person will mail matter which is nonmailable under this section in return for payment; or

‘‘(B) the fact that the person is on the list created under section 2A(e) of the Jenkins Act.

‘‘(b) EXCEPTIONS.— ‘‘(1) CIGARS.—Subsection (a) shall not apply to cigars (as

defined in section 5702(a) of the Internal Revenue Code of 1986).

‘‘(2) GEOGRAPHIC EXCEPTION.—Subsection (a) shall not apply to mailings within the State of Alaska or within the State of Hawaii.

‘‘(3) BUSINESS PURPOSES.— ‘‘(A) IN GENERAL.—Subsection (a) shall not apply to

tobacco products mailed only— ‘‘(i) for business purposes between legally operating

businesses that have all applicable State and Federal Government licenses or permits and are engaged in tobacco product manufacturing, distribution, wholesale, export, import, testing, investigation, or research; or

‘‘(ii) for regulatory purposes between any business described in clause (i) and an agency of the Federal Government or a State government.

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‘‘(B) RULES.— ‘‘(i) IN GENERAL.—Not later than 180 days after

the date of enactment of the Prevent All Cigarette Trafficking Act of 2009, the Postmaster General shall issue a final rule which shall establish the standards and requirements that apply to all mailings described in subparagraph (A).

‘‘(ii) CONTENTS.—The final rule issued under clause (i) shall require—

‘‘(I) the United States Postal Service to verify that any person submitting an otherwise non-mailable tobacco product into the mails as author-ized under this paragraph is a business or govern-ment agency permitted to make a mailing under this paragraph;

‘‘(II) the United States Postal Service to ensure that any recipient of an otherwise nonmailable tobacco product sent through the mails under this paragraph is a business or government agency that may lawfully receive the product;

‘‘(III) that any mailing described in subpara-graph (A) shall be sent through the systems of the United States Postal Service that provide for the tracking and confirmation of the delivery;

‘‘(IV) that the identity of the business or government entity submitting the mailing con-taining otherwise nonmailable tobacco products for delivery and the identity of the business or govern-ment entity receiving the mailing are clearly set forth on the package;

‘‘(V) the United States Postal Service to main-tain identifying information described in subclause (IV) during the 3-year period beginning on the date of the mailing and make the information available to the Postal Service, the Attorney Gen-eral of the United States, and to persons eligible to bring enforcement actions under section 3(d) of the Prevent All Cigarette Trafficking Act of 2009;

‘‘(VI) that any mailing described in subpara-graph (A) be marked with a United States Postal Service label or marking that makes it clear to employees of the United States Postal Service that it is a permitted mailing of otherwise nonmailable tobacco products that may be delivered only to a permitted government agency or business and may not be delivered to any residence or individual person; and

‘‘(VII) that any mailing described in subpara-graph (A) be delivered only to a verified employee of the recipient business or government agency, who is not a minor and who shall be required to sign for the mailing.

‘‘(C) DEFINITION.—In this paragraph, the term ‘minor’ means an individual who is less than the minimum age required for the legal sale or purchase of tobacco products

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as determined by applicable law at the place the individual is located. ‘‘(4) CERTAIN INDIVIDUALS.—

‘‘(A) IN GENERAL.—Subsection (a) shall not apply to tobacco products mailed by individuals who are not minors for noncommercial purposes, including the return of a dam-aged or unacceptable tobacco product to the manufacturer.

‘‘(B) RULES.— ‘‘(i) IN GENERAL.—Not later than 180 days after

the date of enactment of the Prevent All Cigarette Trafficking Act of 2009, the Postmaster General shall issue a final rule which shall establish the standards and requirements that apply to all mailings described in subparagraph (A).


‘‘(I) the United States Postal Service to verify that any person submitting an otherwise non-mailable tobacco product into the mails as author-ized under this paragraph is the individual identi-fied on the return address label of the package and is not a minor;

‘‘(II) for a mailing to an individual, the United States Postal Service to require the person submit-ting the otherwise nonmailable tobacco product into the mails as authorized by this paragraph to affirm that the recipient is not a minor;

‘‘(III) that any package mailed under this para-graph shall weigh not more than 10 ounces;

‘‘(IV) that any mailing described in subpara-graph (A) shall be sent through the systems of the United States Postal Service that provide for the tracking and confirmation of the delivery;

‘‘(V) that a mailing described in subparagraph (A) shall not be delivered or placed in the posses-sion of any individual who has not been verified as not being a minor;

‘‘(VI) for a mailing described in subparagraph (A) to an individual, that the United States Postal Service shall deliver the package only to a recipient who is verified not to be a minor at the recipient address or transfer it for delivery to an Air/Army Postal Office or Fleet Postal Office number des-ignated in the recipient address; and

‘‘(VII) that no person may initiate more than 10 mailings described in subparagraph (A) during any 30-day period.

‘‘(C) DEFINITION.—In this paragraph, the term ‘minor’ means an individual who is less than the minimum age required for the legal sale or purchase of tobacco products as determined by applicable law at the place the individual is located. ‘‘(5) EXCEPTION FOR MAILINGS FOR CONSUMER TESTING BY

MANUFACTURERS.— ‘‘(A) IN GENERAL.—Subject to subparagraph (B), sub-

section (a) shall not preclude a legally operating cigarette manufacturer or a legally authorized agent of a legally

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operating cigarette manufacturer from using the United States Postal Service to mail cigarettes to verified adult smoker solely for consumer testing purposes, if—

‘‘(i) the cigarette manufacturer has a permit, in good standing, issued under section 5713 of the Internal Revenue Code of 1986;

‘‘(ii) the package of cigarettes mailed under this paragraph contains not more than 12 packs of ciga-rettes (240 cigarettes);

‘‘(iii) the recipient does not receive more than 1 package of cigarettes from any 1 cigarette manufac-turer under this paragraph during any 30-day period;

‘‘(iv) all taxes on the cigarettes mailed under this paragraph levied by the State and locality of delivery are paid to the State and locality before delivery, and tax stamps or other tax-payment indicia are affixed to the cigarettes as required by law; and

‘‘(v)(I) the recipient has not made any payments of any kind in exchange for receiving the cigarettes;

‘‘(II) the recipient is paid a fee by the manufacturer or agent of the manufacturer for participation in con-sumer product tests; and

‘‘(III) the recipient, in connection with the tests, evaluates the cigarettes and provides feedback to the manufacturer or agent. ‘‘(B) LIMITATIONS.—Subparagraph (A) shall not—

‘‘(i) permit a mailing of cigarettes to an individual located in any State that prohibits the delivery or shipment of cigarettes to individuals in the State, or preempt, limit, or otherwise affect any related State laws; or

‘‘(ii) permit a manufacturer, directly or through a legally authorized agent, to mail cigarettes in any calendar year in a total amount greater than 1 percent of the total cigarette sales of the manufacturer in the United States during the calendar year before the date of the mailing. ‘‘(C) RULES.—

‘‘(i) IN GENERAL.—Not later than 180 days after the date of enactment of the Prevent All Cigarette Trafficking Act of 2009, the Postmaster General shall issue a final rule which shall establish the standards and requirements that apply to all mailings described in subparagraph (A).


‘‘(I) the United States Postal Service to verify that any person submitting a tobacco product into the mails under this paragraph is a legally oper-ating cigarette manufacturer permitted to make a mailing under this paragraph, or an agent legally authorized by the legally operating cigarette manu-facturer to submit the tobacco product into the mails on behalf of the manufacturer;

‘‘(II) the legally operating cigarette manufac-turer submitting the cigarettes into the mails under this paragraph to affirm that—

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‘‘(aa) the manufacturer or the legally authorized agent of the manufacturer has verified that the recipient is an adult estab-lished smoker;

‘‘(bb) the recipient has not made any pay-ment for the cigarettes;

‘‘(cc) the recipient has signed a written statement that is in effect indicating that the recipient wishes to receive the mailings; and

‘‘(dd) the manufacturer or the legally authorized agent of the manufacturer has offered the opportunity for the recipient to withdraw the written statement described in item (cc) not less frequently than once in every 3-month period; ‘‘(III) the legally operating cigarette manufac-

turer or the legally authorized agent of the manu-facturer submitting the cigarettes into the mails under this paragraph to affirm that any package mailed under this paragraph contains not more than 12 packs of cigarettes (240 cigarettes) on which all taxes levied on the cigarettes by the State and locality of delivery have been paid and all related State tax stamps or other tax-payment indicia have been applied;

‘‘(IV) that any mailing described in subpara-graph (A) shall be sent through the systems of the United States Postal Service that provide for the tracking and confirmation of the delivery;

‘‘(V) the United States Postal Service to main-tain records relating to a mailing described in subparagraph (A) during the 3-year period begin-ning on the date of the mailing and make the information available to persons enforcing this sec-tion;

‘‘(VI) that any mailing described in subpara-graph (A) be marked with a United States Postal Service label or marking that makes it clear to employees of the United States Postal Service that it is a permitted mailing of otherwise nonmailable tobacco products that may be delivered only to the named recipient after verifying that the recipient is an adult; and

‘‘(VII) the United States Postal Service shall deliver a mailing described in subparagraph (A) only to the named recipient and only after verifying that the recipient is an adult.

‘‘(D) DEFINITIONS.—In this paragraph— ‘‘(i) the term ‘adult’ means an individual who is

not less than 21 years of age; and ‘‘(ii) the term ‘consumer testing’ means testing lim-

ited to formal data collection and analysis for the spe-cific purpose of evaluating the product for quality assurance and benchmarking purposes of cigarette brands or sub-brands among existing adult smokers.

‘‘(6) FEDERAL GOVERNMENT AGENCIES.—An agency of the Federal Government involved in the consumer testing of tobacco

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products solely for public health purposes may mail cigarettes under the same requirements, restrictions, and rules and proce-dures that apply to consumer testing mailings of cigarettes by manufacturers under paragraph (5), except that the agency shall not be required to pay the recipients for participating in the consumer testing. ‘‘(c) SEIZURE AND FORFEITURE.—Any cigarettes or smokeless

tobacco made nonmailable by this subsection that are deposited in the mails shall be subject to seizure and forfeiture, pursuant to the procedures set forth in chapter 46 of this title. Any tobacco products seized and forfeited under this subsection shall be destroyed or retained by the Federal Government for the detection or prosecution of crimes or related investigations and then destroyed.

‘‘(d) ADDITIONAL PENALTIES.—In addition to any other fines and penalties under this title for violations of this section, any person violating this section shall be subject to an additional civil penalty in the amount equal to 10 times the retail value of the nonmailable cigarettes or smokeless tobacco, including all Federal, State, and local taxes.

‘‘(e) CRIMINAL PENALTY.—Whoever knowingly deposits for mailing or delivery, or knowingly causes to be delivered by mail, according to the direction thereon, or at any place at which it is directed to be delivered by the person to whom it is addressed, anything that is nonmailable matter under this section shall be fined under this title, imprisoned not more than 1 year, or both.

‘‘(f) USE OF PENALTIES.—There is established a separate account in the Treasury, to be known as the ‘PACT Postal Service Fund’. Notwithstanding any other provision of law, an amount equal to 50 percent of any criminal fines, civil penalties, or other monetary penalties collected by the Federal Government in enforcing this section shall be transferred into the PACT Postal Service Fund and shall be available to the Postmaster General for the purpose of enforcing this subsection.

‘‘(g) COORDINATION OF EFFORTS.—The Postmaster General shall cooperate and coordinate efforts to enforce this section with related enforcement activities of any other Federal agency or agency of any State, local, or tribal government, whenever appropriate.

‘‘(h) ACTIONS BY STATE, LOCAL, OR TRIBAL GOVERNMENTS RELATING TO CERTAIN TOBACCO PRODUCTS.—

‘‘(1) IN GENERAL.—A State, through its attorney general, or a local government or Indian tribe that levies an excise tax on tobacco products, through its chief law enforcement officer, may in a civil action in a United States district court obtain appropriate relief with respect to a violation of this section. Appropriate relief includes injunctive and equitable relief and damages equal to the amount of unpaid taxes on tobacco products mailed in violation of this section to addressees in that State, locality, or tribal land.

‘‘(2) SOVEREIGN IMMUNITY.—Nothing in this subsection shall be deemed to abrogate or constitute a waiver of any sovereign immunity of a State or local government or Indian tribe against any unconsented lawsuit under paragraph (1), or otherwise to restrict, expand, or modify any sovereign immu-nity of a State or local government or Indian tribe.

‘‘(3) ATTORNEY GENERAL REFERRAL.—A State, through its attorney general, or a local government or Indian tribe that


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levies an excise tax on tobacco products, through its chief law enforcement officer, may provide evidence of a violation of this section for commercial purposes by any person not subject to State, local, or tribal government enforcement actions for violations of this section to the Attorney General of the United States, who shall take appropriate actions to enforce this section.

‘‘(4) NONEXCLUSIVITY OF REMEDIES.—The remedies avail-able under this subsection are in addition to any other remedies available under Federal, State, local, tribal, or other law. Nothing in this subsection shall be construed to expand, restrict, or otherwise modify any right of an authorized State, local, or tribal government official to proceed in a State, tribal, or other appropriate court, or take other enforcement actions, on the basis of an alleged violation of State, local, tribal, or other law.

‘‘(5) OTHER ENFORCEMENT ACTIONS.—Nothing in this sub-section shall be construed to prohibit an authorized State offi-cial from proceeding in State court on the basis of an alleged violation of any general civil or criminal statute of the State. ‘‘(i) DEFINITION.—In this section, the term ‘State’ has the

meaning given that term in section 1716(k).’’. (b) CLERICAL AMENDMENT.—The table of sections for chapter

83 of title 18 is amended by inserting after the item relating to section 1716D the following:

‘‘1716E. Tobacco products as nonmailable.’’.

SEC. 4. INSPECTION BY BUREAU OF ALCOHOL, TOBACCO, FIREARMS, AND EXPLOSIVES OF RECORDS OF CERTAIN CIGARETTE AND SMOKELESS TOBACCO SELLERS; CIVIL PENALTY.

Section 2343(c) of title 18, United States Code, is amended to read as follows:

‘‘(c)(1) Any officer of the Bureau of Alcohol, Tobacco, Firearms, and Explosives may, during normal business hours, enter the prem-ises of any person described in subsection (a) or (b) for the purposes of inspecting—

‘‘(A) any records or information required to be maintained by the person under this chapter; or

‘‘(B) any cigarettes or smokeless tobacco kept or stored by the person at the premises. ‘‘(2) The district courts of the United States shall have the

authority in a civil action under this subsection to compel inspec-tions authorized by paragraph (1).

‘‘(3) Whoever denies access to an officer under paragraph (1), or who fails to comply with an order issued under paragraph (2), shall be subject to a civil penalty in an amount not to exceed $10,000.’’. SEC. 5. EXCLUSIONS REGARDING INDIAN TRIBES AND TRIBAL MAT-

TERS.

(a) IN GENERAL.—Nothing in this Act or the amendments made by this Act shall be construed to amend, modify, or otherwise affect—

(1) any agreements, compacts, or other intergovernmental arrangements between any State or local government and any government of an Indian tribe (as that term is defined in section 4(e) of the Indian Self-Determination and Education

15 USC 375 note.

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Assistance Act (25 U.S.C. 450b(e)) relating to the collection of taxes on cigarettes or smokeless tobacco sold in Indian country;

(2) any State laws that authorize or otherwise pertain to any such intergovernmental arrangements or create special rules or procedures for the collection of State, local, or tribal taxes on cigarettes or smokeless tobacco sold in Indian country;

(3) any limitations under Federal or State law, including Federal common law and treaties, on State, local, and tribal tax and regulatory authority with respect to the sale, use, or distribution of cigarettes and smokeless tobacco by or to Indian tribes, tribal members, tribal enterprises, or in Indian country;

(4) any Federal law, including Federal common law and treaties, regarding State jurisdiction, or lack thereof, over any tribe, tribal members, tribal enterprises, tribal reservations, or other lands held by the United States in trust for one or more Indian tribes; or

(5) any State or local government authority to bring enforcement actions against persons located in Indian country. (b) COORDINATION OF LAW ENFORCEMENT.—Nothing in this Act

or the amendments made by this Act shall be construed to inhibit or otherwise affect any coordinated law enforcement effort by 1 or more States or other jurisdictions, including Indian tribes, through interstate compact or otherwise, that—

(1) provides for the administration of tobacco product laws or laws pertaining to interstate sales or other sales of tobacco products;

(2) provides for the seizure of tobacco products or other property related to a violation of such laws; or

(3) establishes cooperative programs for the administration of such laws. (c) TREATMENT OF STATE AND LOCAL GOVERNMENTS.—Nothing

in this Act or the amendments made by this Act shall be construed to authorize, deputize, or commission States or local governments as instrumentalities of the United States.

(d) ENFORCEMENT WITHIN INDIAN COUNTRY.—Nothing in this Act or the amendments made by this Act shall prohibit, limit, or restrict enforcement by the Attorney General of the United States of this Act or an amendment made by this Act within Indian country.

(e) AMBIGUITY.—Any ambiguity between the language of this section or its application and any other provision of this Act shall be resolved in favor of this section.

(f) DEFINITIONS.—In this section— (1) the term ‘‘Indian country’’ has the meaning given that

term in section 1 of the Jenkins Act, as amended by this Act; and

(2) the term ‘‘tribal enterprise’’ means any business enter-prise, regardless of whether incorporated or unincorporated under Federal or tribal law, of an Indian tribe or group of Indian tribes.

SEC. 6. EFFECTIVE DATE.

(a) IN GENERAL.—Except as provided in subsection (b), this Act shall take effect on the date that is 90 days after the date of enactment of this Act.

15 USC 375 note.


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LEGISLATIVE HISTORY—S. 1147: CONGRESSIONAL RECORD, Vol. 156 (2010):

Mar. 11, considered and passed Senate. Mar. 17, considered and passed House.

Æ

(b) BATFE AUTHORITY.—The amendments made by section 4 shall take effect on the date of enactment of this Act. SEC. 7. SEVERABILITY.

If any provision of this Act, or any amendment made by this Act, or the application thereof to any person or circumstance, is held invalid, the remainder of the Act and the application of the Act to any other person or circumstance shall not be affected thereby. SEC. 8. SENSE OF CONGRESS CONCERNING THE PRECEDENTIAL

EFFECT OF THIS ACT.

It is the sense of Congress that unique harms are associated with online cigarette sales, including problems with verifying the ages of consumers in the digital market and the long-term health problems associated with the use of certain tobacco products. This Act was enacted recognizing the longstanding interest of Congress in urging compliance with States’ laws regulating remote sales of certain tobacco products to citizens of those States, including the passage of the Jenkins Act over 50 years ago, which established reporting requirements for out-of-State companies that sell certain tobacco products to citizens of the taxing States, and which gave authority to the Department of Justice and the Bureau of Alcohol, Tobacco, Firearms, and Explosives to enforce the Jenkins Act. In light of the unique harms and circumstances surrounding the online sale of certain tobacco products, this Act is intended to help collect cigarette excise taxes, to stop tobacco sales to underage youth, and to help the States enforce their laws that target the online sales of certain tobacco products only. This Act is in no way meant to create a precedent regarding the collection of State sales or use taxes by, or the validity of efforts to impose other types of taxes on, out-of-State entities that do not have a physical presence within the taxing State.

Approved March 31, 2010.

15 USC 375 note.


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public law 111–154 111th congress an act · public law 111–154—mar. 31, 2010 124 stat. 1091...

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